TIDMBVM
RNS Number : 9678H
Belgravium Technologies PLC
03 March 2010
+----------------------------------+----------------------------------+
| For Immediate Release | 3 March 2010 |
+----------------------------------+----------------------------------+
Belgravium Technologies Plc
(BVM:AIM)
Belgravium Technologies plc
Preliminary Results for the Twelve Months ended 31 December 2009
The Board of Belgravium Technologies plc ('Belgravium' or 'the Group'),
designers and suppliers of mobile data capture systems, is pleased to announce
preliminary results for the twelve months ended 31 December 2009.
Highlights:
o Revenue maintained at GBP8,286,000 (2008: GBP8,330,000)
o Profit before tax increased to GBP405,000 (2008: GBP398,000)
o Cash generation of GBP244,000 reduces net debt position to GBP1,424,000
o EPS increased to 0.43p (2008: 0.39p)
o Market share maintained in uncertain conditions
Commenting on the year end results, John Kembery, Chairman of Belgravium, said:
"I am pleased to report that Belgravium has met its strategic business
objectives whilst delivering a profit in line with market expectations and
reduced net debt. This is a particularly pleasing outcome given the worldwide
loss of financial confidence which has affected all of our markets throughout
2009".
For further information please contact:
Belgravium Technologies Plc
John Kembery
07770 731 021
WH Ireland
Eric Burns
07910 900 950
CHAIRMAN'S STATEMENT 2009
Results
I am pleased to report that Belgravium has met its strategic business objectives
whilst delivering a profit in line with market expectations and reduced net
debt. This is a particularly positive outcome given the worldwide loss of
financial confidence which has affected all of our markets throughout 2009.
Despite a marginal fall in revenues from GBP8,330,000 to GBP8,286,000, the Group
made a profit before tax of GBP405,000 in the twelve months ended 31 December
2009, an improvement on the GBP398,000 achieved in the previous year. Although
sales were strong in the last quarter of 2009, this is usually our best quarter
and the similarity of first and second half sales shows that the market has not
yet improved.
Basic earnings per share increased from 0.39p per ordinary share in 2008 to
0.43p per share in 2009.
Cash flow continued to be positive and net debt reduced by GBP244,000 in the
year.
The contraction in our market and the operational gearing inherent within the
Belgravium business model is very obvious when these results are compared with
2007 when the Group achieved revenues of GBP10,637,000 and made a profit before
tax of over GBP2 million. A sustained improvement in market conditions would
quickly enable us to return to better profits.
Operational Review
On maintained revenues, gross profit fell by 6.7% in 2009 compared to 2008.
This was caused by pressure on hardware prices mitigated to some extent by our
strategy of placing greater emphasis on our software and complete solutions.
There was a compensating drop in administration costs of 6.9%, following a cost
saving programme which ran throughout the year. All costs not considered
strategically important were strictly controlled and the success of this
programme contributed significantly to the maintenance of profits. In addition,
productivity has been improved but numbers employed, particularly in the
technical departments, will have to be increased once sales activity starts to
increase.
The new "Boston" hand-held terminal, announced in the early part of the year,
won general acclaim for its rugged functionality. Equipped with a long range
barcode scanner and integral camera, this product was important in winning a
major contract for the location, tracking and condition of palletised goods.
This project offered considerable operational advantages and should lead to
further business.
In the early part of the year, we signed an international supply agreement with
SHV Group to supply LPG delivery systems in each of their many countries of
operation. In the last quarter we supplied a major contract for SHV's
distribution company in Italy, based upon our unique products for the
petrochemical market. Several more such systems have orders pending in other
countries with authorisation awaited from local management.
We have made progress with other petrochemical companies on several promising
contracts across Europe and some smaller outlets in the UK, incorporating
continual refinement and improvement of our purpose built products. There is a
lot of opportunity in this sector but the selling process is protracted.
Our distributor in the USA, a software house specialising in petrochemical
systems, had a better 2009 compared with 2008 but has still not recovered to the
levels enjoyed in previous years.
Group activity in mobile retailing has been historically targeted at planes and
trains. Airlines, in particular, have been under serious pressure in the past
two years and have sought ways of increasing their margins, which has brought
more interest in in-flight retailing services. Whilst we have a
long-established presence in this market, we have, until recently, been unable
to supply all the functions that the operators now require. As a result of
strenuous developments in hardware and software, some involving specialised
partners, we now have the most complete product range in the business. This
created a great deal of fresh interest as the year concluded, with excellent
prospects for 2010.
In the second half of 2009, our product development plans tended to concentrate
on refinement and improvement of existing hardware, through listening to our
customers and responding to their requests for added functionality. There have
also been some attractive improvements in software which contributed to the
greater appeal of our range. This strategy will continue in 2010, as our
current product range is comprehensive and refinement is therefore more
appropriate.
Balance Sheet
Belgravium has a sound balance sheet and has always been cash generative. With
recent lower levels of profitability, we have felt it necessary to use all our
available cash to reduce bank borrowings. As the year closed, total net debt
was GBP1,424,000, having reduced by GBP538,000 in the past two years, an
excellent achievement in the current economic climate.. The objective must be
to further reduce debt and as a result we are not recommending a final dividend
for the year. The Directors recognise that this is important to many
shareholders and remain committed to restoring dividend payments as soon as
conditions allow.
The Market
Belgravium manufactures and installs complete systems, incorporating both
hardware and software, for real time data capture in the logistics,
petrochemical and mobile retailing markets. There is a very real need for such
systems, either to improve operating costs, efficiency or turnover. In
addition, there are plenty of new prospects and opportunities to expand as we
add new functions and capability to our systems. We rarely have to convince
operating management of these advantages but it has proved increasingly
difficult, in the current economic climate, to gain financial authorisation for
what are usually seen as capital projects.
This is currently the nature of our market; slow moving and frustrating.
Margins are still healthy, and we believe that revenue growth will be restored
once confidence returns.
Strategy
It is Belgravium's overall objective to grow revenues. This will automatically
increase profits and cash generation, given our operational leverage. In the
current market we have devised a strategy which was explained in the 2009
Interim Report, which we continue to pursue. It is:
1. Persistent and determined sales focus at all levels. Everyone is
a salesman.
2. Making sure that all products are fit for purpose and fit the
customer's needs.
3. Supplying the complete solution, with increasing elements of
repeat revenue.
4. Controlling costs with a focus on cash management.
5. Where we do not have expertise in a chosen sector, seek a
strategic relationship with a partner who does.
Employees
It is not easy to deliver profits in these conditions and this shows in the
results of many companies. That Belgravium has managed to fulfil many of its
strategic objectives whilst reducing its costs, has required great application
and flexibility by staff at all levels. This has been given without question
and is a great tribute to the professionalism of our team.
As previously announced, from the 1st January 2010 Mike Unwin joined the Board
as Financial Director and Chris Phillips has taken over as Company Secretary.
After nine years of valuable service as a Non-executive Director, Stephen Day
has announced that he will not seek re-election at the next AGM.
Outlook
During 2009 we have maintained profitability and made significant progress
against our strategic objectives whilst continuing to reduce our net debt
position. As we enter 2010 there are several exciting prospects which could
deliver improved results but the uncertainty as to the timing of when they will
mature, remains.
J P Kembery
Executive Chairman
2 March 2010
+-----------------------+--------+----------+----------+----------+----------+---------+--------+
| | | | | 2009 | 2008 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| | | | | GBP'000 | GBP'000 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Revenue | | | | 8,286 | 8,330 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Cost of sales | | | | (4,084) | (3,824) |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Gross profit | | | | 4,202 | 4,506 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Distribution costs | | | | (94) | (89) |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Administrative | | | | (3,623) | (3,892) |
| expenses | | | | | |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Operating profit | | | | 485 | 525 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Finance income | | | | 4 | 5 |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Finance expense | | | | (84) | (132) |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Profit before income | | | | 405 | 398 |
| tax | | | | | |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Income tax credit | | | | 32 | - |
+-----------------------+--------+----------+----------+----------+-----------------------------+
| Profit for the year attributable to the | | 437 | 398 |
| owners of the parent | | | |
+-------------------------------------------+----------+----------+-----------------------------+
| | | | | |
+-------------------------------------------+----------+---------------------+---------+--------+
| Earnings per ordinary share (pence) attributable to equity holders of the parent | |
| during the year | |
| | |
| | |
| | |
+--------------------------------------------------------------------------------------+--------+
| Basic | | 0.43p | 0.39p | |
+-------------------------------------------+----------+---------------------+---------+--------+
| Diluted | | 0.43p | 0.39p | |
+-------------------------------------------+----------+---------------------+---------+--------+
| | | | | | | | |
+-----------------------+--------+----------+----------+----------+----------+---------+--------+
+-----------------------+---------+---------+------------+---------+---------+
| | Called | Share | Capital | Profit | Total |
| | up | premium | redemption | and | |
| | share | | reserve | loss | |
| | capital | | | account | |
+-----------------------+---------+---------+------------+---------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------+---------+---------+------------+---------+---------+
| Balance at 1 January | 5,047 | 2,932 | 2,100 | (892) | 9,187 |
| 2008 | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Comprehensive income | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Profit for the year | - | - | - | 398 | 398 |
+-----------------------+---------+---------+------------+---------+---------+
| Transactions with | | | | | |
| owners | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Dividends relating to | - | - | - | (384) | (384) |
| 2007 | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Balance at 31 | 5,047 | 2,932 | 2,100 | (878) | 9,201 |
| December 2008 | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Comprehensive income | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
| Profit for the year | - | - | - | 437 | 437 |
+-----------------------+---------+---------+------------+---------+---------+
| Balance at 31 | 5,047 | 2,932 | 2,100 | (441) | 9,638 |
| December 2009 | | | | | |
+-----------------------+---------+---------+------------+---------+---------+
+--------------+--------+---------+---------+
| | | 2009 | 2008 |
+--------------+--------+---------+---------+
| | | GBP'000 | GBP'000 |
+--------------+--------+---------+---------+
| Non-current | | | |
| assets | | | |
+--------------+--------+---------+---------+
| Intangible | | | |
| assets | | | |
+--------------+--------+---------+---------+
| Goodwill | | 9,124 | 9,124 |
+--------------+--------+---------+---------+
| Development | | 298 | 285 |
| expenditure | | | |
+--------------+--------+---------+---------+
| Intangible | | 9,422 | 9,409 |
| assets | | | |
+--------------+--------+---------+---------+
| Property, | | 316 | 354 |
| plant and | | | |
| equipment | | | |
+--------------+--------+---------+---------+
| | | 9,738 | 9,763 |
+--------------+--------+---------+---------+
| Current | | | |
| assets | | | |
+--------------+--------+---------+---------+
| Inventories | | 1,223 | 1,358 |
| | | | |
+--------------+--------+---------+---------+
| Trade | | 2,527 | 2,647 |
| and | | | |
| other | | | |
| receivables | | | |
+--------------+--------+---------+---------+
| Current | | 50 | - |
| tax | | | |
| assets | | | |
+--------------+--------+---------+---------+
| Cash | | 2 | 2 |
| and | | | |
| cash | | | |
| equivalents | | | |
+--------------+--------+---------+---------+
| | | 3,802 | 4,007 |
+--------------+--------+---------+---------+
| Total | | 13,540 | 13,770 |
| assets | | | |
+--------------+--------+---------+---------+
| Current | | | |
| liabilities | | | |
+--------------+--------+---------+---------+
| Trade | | 2,420 | 2,818 |
| and | | | |
| other | | | |
| payables | | | |
+--------------+--------+---------+---------+
| Current | | - | 34 |
| income | | | |
| tax | | | |
| liabilities | | | |
+--------------+--------+---------+---------+
| Deferred | | 39 | 21 |
| income | | | |
| tax | | | |
| liabilities | | | |
+--------------+--------+---------+---------+
| Financial | | 815 | 962 |
| liabilities: | | | |
| Borrowings | | | |
+--------------+--------+---------+---------+
| Short | | 17 | 26 |
| term | | | |
| provisions | | | |
+--------------+--------+---------+---------+
| | | 3,291 | 3,861 |
+--------------+--------+---------+---------+
| Non-current | | | |
| liabilities | | | |
+--------------+--------+---------+---------+
| Financial | | 611 | 708 |
| liabilities: | | | |
| Borrowings | | | |
+--------------+--------+---------+---------+
| Total | | 3,902 | 4,569 |
| liabilities | | | |
+--------------+--------+---------+---------+
| Capital and reserves | |
| attributable to equity | |
| holders of the Company | |
+---------------------------------+---------+
| Ordinary | | 5,047 | 5,047 |
| shares | | | |
+--------------+--------+---------+---------+
| Share | | 2,932 | 2,932 |
| premium | | | |
+--------------+--------+---------+---------+
| Capital | | 2,100 | 2,100 |
| redemption | | | |
| reserve | | | |
+--------------+--------+---------+---------+
| Profit | | (441) | (878) |
| and | | | |
| loss | | | |
| account | | | |
+--------------+--------+---------+---------+
| Total | | 9,638 | 9,201 |
| equity | | | |
+--------------+--------+---------+---------+
| Total | | 13,540 | 13,770 |
| equity | | | |
| and | | | |
| liabilities | | | |
+--------------+--------+---------+---------+
+---------------------+--------+---------+---------+
| | | 2009 | 2008 |
| | | GBP'000 | GBP'000 |
+---------------------+--------+---------+---------+
| Cash | | | |
| flows | | | |
| from | | | |
| operating | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Operating | | 485 | 525 |
| profit | | | |
+---------------------+--------+---------+---------+
| Depreciation | | 177 | 128 |
+---------------------+--------+---------+---------+
| Amortisation | | 139 | 111 |
+---------------------+--------+---------+---------+
| Profit | | - | (3) |
| on | | | |
| sale | | | |
| of | | | |
| tangible | | | |
| fixed | | | |
| assets | | | |
+---------------------+--------+---------+---------+
| Movement | | | |
| in: | | | |
+---------------------+--------+---------+---------+
| Provisions | | (9) | (20) |
+---------------------+--------+---------+---------+
| Inventories | | 135 | (96) |
+---------------------+--------+---------+---------+
| Trade | | 120 | 1,254 |
| and | | | |
| other | | | |
| receivables | | | |
+---------------------+--------+---------+---------+
| Trade | | (398) | (336) |
| and | | | |
| other | | | |
| payables | | | |
+---------------------+--------+---------+---------+
| Cash | | 649 | 1,563 |
| generated | | | |
| from | | | |
| operations | | | |
+---------------------+--------+---------+---------+
| Interest | | 4 | 5 |
| received | | | |
+---------------------+--------+---------+---------+
| Interest | | (84) | (123) |
| paid | | | |
+---------------------+--------+---------+---------+
| Corporation | | (34) | (410) |
| tax paid | | | |
+---------------------+--------+---------+---------+
| Net | | 535 | 1,035 |
| cash | | | |
| generated | | | |
| from | | | |
| operating | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Cash | | | |
| flows | | | |
| from | | | |
| investing | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Proceeds | | - | 3 |
| from | | | |
| sale of | | | |
| property, | | | |
| plant and | | | |
| equipment | | | |
+---------------------+--------+---------+---------+
| Expenditure | | (152) | (129) |
| on | | | |
| intangible | | | |
| fixed | | | |
| assets | | | |
+---------------------+--------+---------+---------+
| Purchase | | (139) | (231) |
| of | | | |
| property, | | | |
| plant and | | | |
| equipment | | | |
+---------------------+--------+---------+---------+
| Net | | (291) | (357) |
| cash | | | |
| used | | | |
| in | | | |
| investing | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Cash | | | |
| flows | | | |
| from | | | |
| financing | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Repayment | | (141) | (542) |
| of bank | | | |
| borrowings | | | |
+---------------------+--------+---------+---------+
| Dividends | | - | (384) |
| paid to | | | |
| company's | | | |
| ordinary | | | |
| shareholders | | | |
+---------------------+--------+---------+---------+
| Net | | (141) | (926) |
| cash | | | |
| used | | | |
| in | | | |
| financing | | | |
| activities | | | |
+---------------------+--------+---------+---------+
| Net | | 103 | (248) |
| increase/(decrease) | | | |
| in cash, cash | | | |
| equivalents and | | | |
| bank overdrafts | | | |
+---------------------+--------+---------+---------+
| Cash, | | (460) | (212) |
| cash | | | |
| equivalents | | | |
| and bank | | | |
| overdrafts | | | |
| at start of | | | |
| the year | | | |
+---------------------+--------+---------+---------+
| Cash, | | (357) | (460) |
| cash | | | |
| equivalents | | | |
| and bank | | | |
| overdrafts | | | |
| at end of | | | |
| the year | | | |
+---------------------+--------+---------+---------+
1. General Information
Belgravium Technologies plc is a public limited company incorporated and
domiciled in the UK and listed on the Alternative Investment Market. Its
registered office is 151 Vincent Street, Glasgow, G2 5NJ.
The consolidated financial statements were authorised for issue in accordance
with a resolution of the Directors on 3 March 2010.
2. Basis of preparation
The financial information set out in this document does not constitute the
Group's financial statements for the year ended 31 December 2009 or 31 December
2008. The annual report and financial statements for the year ended 31 December
2009 were approved by the Board of Directors on 2 March 2010 along with this
preliminary announcement, but have not yet been delivered to the Registrar of
Companies.
The auditors' report on the financial statements for the year ended 31 December
2009 was unqualified and did not contain a statement under section 498 of the
Companies Act 2006. Financial statements for the year ended 31 December 2008
have been delivered to the Registrar of Companies. The auditors' report on the
financial statements for the year ended 31 December 2008 was unqualified and did
not contain a statement under section 237 of the Companies Act 1985.
The audited consolidated financial statements from which these results are
extracted have been prepared under the historical cost convention and in
accordance with International Financial Reporting Standards (IFRS) as adopted by
the European Union, IFRIC interpretations and those parts of the Companies Act
2006 applicable to companies reporting under IFRS.
The accounting policies set out below represent an extract of the policies set
out in the consolidated financial statements. There have been no changes in
accounting policies in the year.
3. Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future. The resulting
accounting estimates will, by definition, seldom equal the related actual
results. The estimates and assumptions that have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the
next financial year are discussed below.
(a) Estimated impairment of goodwill
The Group tests annually whether goodwill has suffered any impairment, in
accordance with its accounting policy. The recoverable amounts of
cash-generating units have been determined based on value-in-use calculations.
These calculations require the use of estimates, both in arriving at the
expected future cash flows and the application of a suitable discount rate in
order to calculate the present value of these flows.
(b) Development expenditure
The Group recognises costs incurred on development projects as an intangible
asset which satisfy the requirements of IAS 38. The calculation of the costs
incurred includes the percentage of time spent by certain employees on the
development project. The decision whether to capitalise and how to determine
the period of economic benefit of a development project requires an assessment
of the commercial viability of the project and the prospect of selling the
project to new or existing customers.
+---------------------+--------+---------+---------+
| | | 2009 | 2008 |
| | | GBP'000 | GBP'000 |
+---------------------+--------+---------+---------+
| Reconciliation | | | |
| of net | | | |
| financial | | | |
| liabilities | | | |
+---------------------+--------+---------+---------+
| Net | | 103 | (248) |
| increase/(decrease) | | | |
| in cash, cash | | | |
| equivalents and | | | |
| bank overdrafts | | | |
+---------------------+--------+---------+---------+
| Net | | 141 | 542 |
| change | | | |
| in | | | |
| bank | | | |
| loans | | | |
| and | | | |
| finance | | | |
| leases | | | |
+---------------------+--------+---------+---------+
| Movement | | 244 | 294 |
| in net | | | |
| financial | | | |
| liabilities | | | |
| in the year | | | |
+---------------------+--------+---------+---------+
| Net | | (1,668) | (1,962) |
| financial | | | |
| liabilities | | | |
| at | | | |
| beginning | | | |
| of year | | | |
+---------------------+--------+---------+---------+
| Net | | (1,424) | (1,668) |
| financial | | | |
| liabilities | | | |
| at end of | | | |
| year | | | |
+---------------------+--------+---------+---------+
+------------------------------------------------+---------+---------+
| | 2009 | 2008 |
+------------------------------------------------+---------+---------+
| Basic earnings per ordinary share | 0.43p | 0.39p |
+------------------------------------------------+---------+---------+
| Diluted earnings per ordinary share | 0.43p | 0.39p |
+------------------------------------------------+---------+---------+
Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of ordinary shares in issue
during the year.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive ordinary shares. The
dilutive ordinary shares represent the share options and warrants granted to
employees where the exercise price is less than the average market price of the
Company's ordinary shares during the year.
Reconciliations of the earnings and weighted average number of shares used in
the calculation are set out below:
+--------------+----------+------------+----------+------------+
| | 2009 | 2008 |
+--------------+-----------------------+-----------------------+
| | Earnings | Weighted | Earnings | Weighted |
| | GBP'000 | average | GBP'000 | average |
| | | number | | number |
| | | of | | of |
| | | shares | | shares |
| | | (in | | (in |
| | | thousands) | | thousands) |
+--------------+----------+------------+----------+------------+
| Basic | | | | |
| EPS | | | | |
+--------------+----------+------------+----------+------------+
| Earnings | 437 | 100,937 | 398 | 100,937 |
| attributable | | | | |
| to ordinary | | | | |
| shareholders | | | | |
+--------------+----------+------------+----------+------------+
| Effect | | | | |
| of | | | | |
| dilutive | | | | |
| securities | | | | |
+--------------+----------+------------+----------+------------+
| Options | - | - | - | - |
+--------------+----------+------------+----------+------------+
| Diluted | | | | |
| EPS | | | | |
+--------------+----------+------------+----------+------------+
| Adjusted | 437 | 100,937 | 398 | 100,937 |
| earnings | | | | |
+--------------+----------+------------+----------+------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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